Sobbing during her first court appearance, a San Francisco woman pleaded not guilty Thursday to charges that she failed to protect her 2-year-old niece from being struck by a hit-and-run driver on a busy street in downtown San Francisco.

Loyresha Gage, 25, was arraigned in San Francisco Superior Court on a felony count of child endangerment as police continued to search for the driver that struck and killed Mi'yana Gregory last Friday night on the 800 block of Mission Street.

The toddler's relatives remained split over whether Gage should be prosecuted in the unusual case - or whether the loss of her niece was punishment enough.

Gage's grandmother, Irene Mathews, suggested outside court that Gage would make bail after the amount was lowered from $250,000 to $50,000.

"I'm just happy she'll be coming home," she said. "I don't think she should have any bail at all. She's just not that kind of person."

Gage's public defender, Kevin Mitchell, argued that his client should be released, saying she had no criminal record, had worked for Muni for six years and had been scheduled to start classes at Skyline College in San Bruno this week. He said charging Gage compounded the tragedy.

"To place Ms. Gage in custody before the child is even buried interrupts the grieving process," Mitchell said. "She should be allowed to fight this from the outside."

The San Francisco district attorney's office, though, said the charges were appropriate. The prosecutor handling the case, Marianne Barrett, told Judge Tracie Brown, "We acknowledge that this is a tragedy, but the defendant's reckless actions that endangered the victim cannot be ignored."

Mi'yana's great-grandmother on her father's side, Cynthia Johnson, said the driver needs to be brought to justice, but insisted that Gage was at least partially responsible. Mi'yana's mother and father are not in a relationship.

"Of course we need to look for the other party involved, but they were only involved due to her negligence," Johnson said. "I still want to know what she was doing out there with two little babies at 10 o'clock at night."

District Attorney George Gascón acknowledged that the strong feelings on both sides of the family complicated the case.

"You've got one side asking us to release her and the other asking us to prosecute," he said. "This is not a decision we made lightly. We don't make the facts. They come to us as they are."

The accident occurred at 10:37 p.m. outside the Westfield San Francisco Centre. Gage had taken Mi'yana and the girl's twin brother to a movie, and was crossing Mission Street between Fourth and Fifth streets to a multistory parking garage, police said.

Investigators said Gage walked Mi'yana into the middle of the crosswalk against the signal. Gage then allegedly left the toddler in the street, returning to the sidewalk to grab the girl's twin brother, Michael Gregory III.

A driver with a green light hit Mi'yana and never stopped, said Officer Albie Esparza, a police spokesman. He described the vehicle as a four-door sedan from the 1990s, possibly a Toyota, Honda or Lexus.

Esparza said there's a chance the driver didn't know he or she had hit the little girl. Still, he said, the driver is likely aware of what happened by now and should come forward.

Since the incident, a memorial of stuffed animals, flowers, candles and pictures has grown at the site on Mission Street.